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Lawmakers approve govt tax package

Lawmakers approve govt tax package

 

Budapest, November 22 (MTI) – Parliament approved on Tuesday the government’s so-called autumn tax package that targets reducing the public burden, boosting competitiveness and streamlining the tax bureaucracy.

The revenue limit applied to itemised tax for small business taxpayers will be raised, the exemption threshold for VAT will be similarly raised, while rules for health-care contributions will be simplified. Further, the tax authority will switch to helping taxpayers who make errors on their returns rather than punishing them.

The measure sponsored by Economy Minister Mihály Varga passed with 131 MPs in favour, 38 against and 25 abstentions.

The law raises the revenue threshold for the itemised tax for small businesses, known by its Hungarian acronym “kata”, from 6 million forints to 12 million from next year and the threshold on total assets for companies already taxed under the small business tax, known by its Hungarian acronym “kiva”, to 1 billion forints. The threshold for companies that first opt for kiva remains at 500 million.

It reduces the number of rates for the healthcare contribution, known by its Hungarian acronym “eho”, to two (14 percent and 27 percent) from five ranging from 6 percent to 27 percent. Additionally, it exempts earned interest from the tax.

It introduces a tax preference for investors in start-ups up to 20 million forints annually over four years. The change could bring start-ups 40-60 billion forints in investment money, the economy ministry said earlier.

Other tax preferences the law introduces include ones for live music and for investments that improve energy efficiency.

Photo: MTI

Source: MTI

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